Real Estate Market Bottom in Chicago, When? (foreclosures, mortgage)

[Humboldt1]

When does everyone see the market bottoming? I think mid 2009 may be the time to get back in the game, but what do I know. I bought my last place in July 06 and even though the appraisal says it went up, I doubt I could sell for a profit today unless I sat on it for another year or two.

[aragx6]

I'm by no means an expert, but I suspect a lot of homes will be coming up on the market this spring, so people looking to buy should be able to find deals this fall after those homes have been sitting on the market for half a year. Next spring looks like things will start to even out.

[Johnny Northside]

Yes, I think whenever the rebound comes in Chicago, it will be seasonal -- meaning in spring, when a winter of pent-up demand will combine with the previous pent-up demand (people who decided to wait a year or more). Will it be this spring? Because of the macro issues -- recession fears, election year, etc., I think not. The other thing to consider is that each suburb and neighborhood is going to react in a different way -- based on the general outlook of that specific area, the number of foreclosures nearby, etc.

[Lookout Kid]

I'm hoping for this Spring... I know a lot of people who have been waiting on the sidelines to buy a place, and they're getting impatient. However, there are also a lot of people waiting to sell, so it depends on how much pent up supply vs. pent up demand there is...

[Humboldt1]

The rebound WILL NOT happen this spring. Too many factors are against it. With even the NAR (national association of realtors) forecasting declines in prices we are surely headed down. Foreclosures are also increasing. If we bottom before next spring I am pleasantly surprised.

[SloopyJ]

My take is that we're probably very close to bottom in the suburbs, but a year away in the city. I would say, though, that the bottom will probably look like a bathtub - with a very long period of flat prices before we uptick.

When things got bad on the credit front, suburban construction (most of which is small scale development) came to a halt. My guess is we'll see most of that product getting absorbed this year resulting in stable-to-improving market conditions there. But city projects, particularly downtown, are far larger and more difficult to stop mid-stream. The result of that is we have some 6,000 residential units coming online in the next year downtown - not including other projects farther north than the Gold Coast - and that will keep pressure on prices through next winter in the city. 2009 may see the same "stability" in the city that 2008 sees in the 'burbs, with prices not really rising until 2010.

Just my guess...

[allnightlong]

It is definitely going to be a couple more years before things go back to that upward rise in values and even then it is not going to be to the extent that is was. Also most mortgage investors have tightened up on their guidelines which makes it harder for people to get loans to buy houses. The days of subprime lending are over! My guess is over the next year you are going to see more and more foreclosures and then a bout a year from that you'll see a boom with people buying houses at a low price. After about a year of that you'll see the market getting better and then values will start to increase slowly. That's just my opinion, but what do I know.

[Avengerfire]

Not until after we know who our next president will be and what he or she can get done. I say it begins to come back in Spring 2009 but will not be at the level it was a couple years ago for a couple years..

[mdz]

IMO, everything comes down to prices. What does the average person make, and what is the average house cost? What's a doable price to pay, maybe 3 times your annual salary for a house?

Prices in a lot of areas are still nowhere near that. When it gets closer to a traditional median pay/median house price ratio, then it's time for the housing market to rebound.

But I'm an idiot, and never would have expected the crazy rise in prices and funny mortgages that occurred over the last 5 years or so. So take the above with a ton of salt.

[Humboldt1]

Mdz,

I agree with what you are saying but think a 4 to 1 ratio may be more in line. On the coasts it will be closer to 5 or 6 and in rural communities closer to 3. Just my opinion as well.

And, you are not an idiot.